As part of our series called “5 Things I Wish Someone Told Me Before I Began Leading My Company,” we had the pleasure of interviewing Kevin McCray.
Kevin’s Natural Foods was co-founded by Kevin McCray, who battled a severe auto-immune disorder for years. When conventional medicine wasn’t doing the trick to keep him healthy, he turned to the Paleo diet — a move that would cure him of his ailment and motivate him to share his story with others. After talking with hundreds of people, Kevin was convinced that making it easy to cook delicious food is the key to truly helping people eat clean over the long term. Thus, Kevin’s Natural Foods was born. Offering Paleo & Keto-certified sauces, seasoning blends and sous-vide entrées, Kevin’s provides all the essentials needed to take clean-eating to the next level.
Thank you so much for joining us in this interview series. I know that you are a very busy person. Before we dive in, our readers would love to “get to know you” a bit better. Can you tell us a bit about your ‘backstory’ and how you grew up?
I grew up in the suburbs outside of Sacramento. My family was as middle class as they come and my Dad was a spitting image of the American dream. He owned and operated a thriving small business and, although I never had the latest Air Jordan’s, I never wanted for anything growing up. I did well in school and was an average soccer player. Since I wasn’t an all star on the field, by the time I was driving age, I was eager to get a job to fund the most important thing in high school — my social life. The day I turned 16 I got my license and the very next day I had an interview at Red Robin, where I got my first job and fell in love with work.
What were your early inspirations that set you off on your particular journey?
While I was pursuing my business degree at SDSU I was hit with an auto-immune disorder out of the blue. After being laid up in the hospital for weeks, I was able to rehab back to full health only to end up back in the hospital every few months struggling with the same ailment. This cycle lasted for years. Frustrated and defeated, I happened to stumble on a paper about how the Paleo Diet could be effective in reversing autoimmune disorders and adopted the diet that would change my life forever. I returned to good health, kicked my dependence on conventional medicine, and have been an advocate of clean-eating ever since.
Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lessons or ‘take aways’ you learned from that?
When we first launched our simmer sauces, they were filled into plain plastic pouches that were packed into printed boxes with the product info. Our first customer wanted to cross-merchandise the sauces with their packaged meat. To accomplish this, we ordered a peg system that was designed to display the sauces above the chicken in the meat case. The week before we printed the sauce boxes, our customer said that they were really focused on eco-friendly packaging. Trying to be over-achievers, we made the last-minute decision to print the sauce boxes using 100% recycled material as opposed to the virgin material we had already vetted. The day after we launched, I had 20 missed calls by the time I woke up and got to my phone. Dozens of angry Meat Managers were calling to let me know that they had sauce pouches piled up on top of their chicken display. Apparently, the recycled material wasn’t as strong and the sauces were falling through the bottom of the boxes. Needless to say, we never rolled out a packaging change without testing it in its proper environment after that.
None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are? Can you share a story?
When I got married and began eating most meals with my wife, she politely pointed out how weird it was that I had been eating the same small variety of foods over and over again every day for the past 10 years. This stuck with me and I started talking to other folks that were working to clean up their diets. Soon, it became painfully obvious that an increasing number of people were adopting lifestyle diets that limited their food choices (i.e. Paleo, Keto, Gluten Free, Vegan, etc) and that this move decreased their already limited repertoire of go-to home-cooked meals. This phenomenon was amplified by the fact that the world had sped up and less people were spending the time necessary to become a home cook that could easily whip up a variety of recipes on top of their 50-hour workweek.
Can you tell us a story about the hard times that you faced when you first started your journey?
Every so often an event sparks a society-wide shift in the way we behave, the way we spend our time, and how we view our personal priorities. The pandemic is definitely one of those times. We were fortunate to hit our stride during this time when many businesses were impacted because of the emerging in home cooking trend, demanding convenient foods. I have no doubt that we will analyze the long-term implications for years to come, but in the meantime, I am working to identify, understand, and encourage the shifts in behavior we are seeing today that have the potential to lead to a healthier nation tomorrow.
Where did you get the drive to continue even though things were so hard?
I am not especially talented. Many founders will admit the same thing. The difference is action. If you don’t act, your idea will never see the light of day no matter how good it is. People tend to hit a stop sign and never punch the gas pedal again. Every week we deal with some hurdle that requires us to do something resourceful, creative or uncomfortable.
What’s more, I notice a lot of folks lose steam once they have one aspect of the business figured out. A good idea only leads to a successful business if you figure out how to manufacture it, price it, distribute it, sell it, and market it. Each aspect of the business is mission critical and should be handled with the same level effort and attention.
So, how are things going today? How did grit and resilience lead to your eventual success?
Things are going well — thanks in part to the pandemic changing what, how and where consumers are eating. We started this business in Q4 of 2019 when we recorded $4.5 million in sales. Shortly after, the world changed forever. Luckily, we were the right product for the time and were fortunate enough to experience rapid expansion (adding 6,000 stores in 12 months) and rapid growth, experiencing a 460% revenue increase in 2020. We project to close out the year with $48 million in sales, and had our best day online on January 1, 2021. This year, we forecast to do $100 million in sales.
What do you think makes your company stand out? Can you share a story?
The more you help people improve their lives, the stronger their affinity will be for your product. The Kevin’s Natural Foods team learned early on that many health-conscious people struggle to get a healthy dinner on the table every day. Because of demands on their time, their dinners became bland and monotonous. So, when our entrées and sauces helped them spice up their menu and add more flavor into their life, while also keeping their nutrition plan on track, they became “crazy” about our brand.
Additionally, it was always our hope to become the type of brand that people want to be associated with because it reflects their core values. By taking a hard stance on good nutrition, our customers are proud to be eating Kevin’s and are happy to spread the word to their friends, family, and online connections.
Which tips would you recommend to your colleagues in your industry to help them to thrive and not “burn out”?
Given the amount of competition in the food space, it is hard to imagine an emerging brand make it without creating enthusiasm. Even if you are solving an unmet need, enthusiasm is an important gauge for how successful your brand can become. To generate enthusiasm in today’s landscape, brands are marrying multiple benefits that would have seemed impossible 10 years ago. For example, at Kevin’s Natural Foods, we aimed to not only make dinner easy to prepare, but we also made sure it tasted amazing while still meeting the standards of today’s most popular lifestyle diets. By solving a combination of needs, we created a passionate following that identifies our brand as a good “fit” for their lifestyle and are so proud to be associated with us that they spread the word to their friends. This effect is necessary to put your brand on the map in such a crowded environment.
How have you used your success to bring goodness to the world?
The central reason for starting Kevin’s Natural Foods was to help as many people as possible eat clean. We know that the majority of people want to eat better and that life makes it hard to stick to good eating habits. It is our hypothesis that if eating clean was easier and tasted better, the likelihood that people would stick to their good intentions will increase. We are only a year in, so most waking hours are spent working on the business. However, feel honored to have been able to donate over 40 thousand of pounds of food to our local food banks over the last year.
Wonderful. Here is the main question of our discussion. What are your “5 things I wish someone told me before I started leading my company” and why? Please share a story or example for each.
- Pay attention to who is buying your products
I have to laugh at how long it took me to truly understand who our target audience is. We invented the line based on insights that I had gleaned from my own life experience. Consequently, I pictured myself as the target customer. While we were working hard for months on messaging to appeal to men in their 30’s with kids at home, there were other market segments buying Kevin’s at a much higher rate. For example, it turns out that 80% of our customers are women and a large portion of them are empty nesters. This, of course, informed everything from media placement, messaging, and even product development. The take away is to be open about who is buying your products and how they are using them as the audience your targeting may be different than the audience that is driving your growth.
2. Understand how the supermarket sales cycle works
Most supermarkets chains manage over 50,000 items and many also have hundreds of store locations. Consequently, it is expensive for them to make product changes at store level and they tend to be very methodical about how and when they update their product assortment. Most supermarkets operate off of a review calendar where they refresh product categories 1–2 times per year depending on the category. The reviews consist of three stages: The Buyer evaluates products and proposals from the suppliers in the category under review. They decide on their product mix based on what they think will sell best while also fitting within their company’s product strategy. Then, they work with their Operations team to reset the stores. It is typically 3+ months from the review period until you will ship your first case.
Since I was brand new to selling food products, I had no idea what went into this process. However, once I had a better understanding of how new products make it to the shelf, we were able to create our own process that was just as methodical. Mainly, we became obsessed with tracking every review period for all of our target customers. Once we put the time into tracking and calendaring dates for the hundreds of prospective reviews relevant to our product lines, it was all downhill from there. We consistently had many irons in the fire at all times and were calling on customers when they wanted to hear from us.
3. Scan Data is expensive, but worth it
From the start with Kevin’s, we were checking all of the boxes for the attributes that Buyers were looking for. Our products were consistently getting high marks for being healthy, convenient, innovative, and delicious. These attributes are objective and easy-to-showcase during a cutting. However, our line was brand new and one question always came up during presentations: Will it sell? Thankfully, from the start our sales velocity was through the roof. However, we didn’t have a reliable way to communicate this to prospective buyers and they weren’t just going to take our word for it.
Investing in scan data from sources like SPINS, IRI, and/or Neilson seemed expensive for a start-up brand and I put if off for longer than I should of. Although I didn’t realize it at the time, it was like we had a world class race car and the data was the key to start it up. Once we could add the sales velocity to our presentations the story was complete and the Buyers could tell we had something special that worked in a retail environment. Also, one thing I didn’t realize is that when you buy syndicated data for your category, you also get access your competitors’ movement down to the store level. This has allowed us to showcase to buyers that they can not only elevate the quality, relevance, and nutritional value of their offering, but also increase sales at the same time. Paying for the data is one of the best investments we have made.
4. Lean on suppliers
Since we had a product line that with a promising strategy and brand position, the companies that supply the inputs we needed to commercialize our products got excited about the prospect of the future business we could generate — even in the early days. Once I realized this, I noticed there were experts everywhere I looked. Each supplier spends all day, every day working to perfect their craft. I learned that if we engaged them correctly, they could be like free consultants helping us improve our products while saving time, money, and headache.
With this in mind, we began turning the tables with suppliers that were “selling” us. We would take the time with suppliers to explain the brand vision and product line in a way that resembled the sales presentations we gave to prospective customers. We made sure they had tried everything and were exciting about being part of our growth. They in turn were invested and offered their most valuable resources–their time and experience– in exchange for the prospects of future returns on this investment. Here are some good places to look for supplier experts. Ingredient suppliers: Get to their R&D team and you will be surprised how much they are willing to help on everything from shelf-life implications to tailored usage levels. Packaging suppliers: They have seen it all and tend to be eager for new, innovative packaging applications. They are just as eager to make sure products using their packaging don’t have issues with performance or shelf life. Carriers: Freight companies have logistics experts that can help you cube out trucks and analyze your movement to consolidate shipments effectively.
5. Ask the consumer
I was in marketing in my past life and it was not uncommon for the companies I worked with to spend thousands of dollars on robust qualitative research campaigns that included focus groups with professional moderators and two-way mirrors. Like many start-up companies, that money was not in our budget. When we were struggling to come up with a name for our brand, we decided to hold our own no frills focus group without the bells and whistles. We simply recruited shoppers from local stores that met demographic criteria we established and hosted them at our office. Every participant had their own cooking station where they prepared their own dinner using our prototype products. Then, we convened for a lively discussion and realized that every single name we had come up with was not resonating. We had lost precious time going down the wrong path for months.
What’s more, it was the focus group participants that actually pressed me about what inspired us to create the brand. When they learned it was a personal passion resulting from a past illness that I battled through sound nutrition, they seeded the idea of calling it Kevin’s and embracing my story.
This was one of dozens of focus groups we went on to host to help us make critical decisions on a variety of aspects of our business related to packaging, flavors, cooking instructions, marketing messaging, etc. Pro tip: Serving a glass or two of wine with dinner will really get the feedback flowing.
Now that you have gained this experience and knowledge, has it affected or changed your personal leadership philosophy and style? How have these changes affected your company?
Our company motto “Humble + Hungry” speaks volumes and is born from my personal experience. We like to pride ourselves on a culture of “radical transparency” which means all team members are privy to business goals, revenue marks, and progress along the way. We find this increases engagement and accountability and fosters a positive environment where our team feels a stake of ownership. To add to the incentive, all employees, regardless of position, are offered units of phantom stock in the company which retain value upon sale. At the time of hire, employees are granted a metric which increases in value as they grow with the business. The idea of phantom stock certainly isn’t new — but the concept of a CPG brand doing it and giving it to ALL employees who, due to transparency of leadership, recognize the earning potential based on the business goals and benchmarks — is more unique.
This series is called “5 Things I Wish Someone Told Me”. This has the implicit assumption that had you known something, you might have acted differently. But from your current vantage point, do you feel that knowing alone would have been enough, or do you feel that ultimately you can only learn from experience? I think that learning from mistakes is the best way, perhaps the only way, to truly absorb and integrate abstract information. What do you think about this idea? Can you explain?
Mistakes are an inevitable part of starting a company. If your experience is anything like mine, they are going to happen and hopefully they will make your company sharper. However, I wholeheartedly believe there are many big ones that are completely avoidable if they are on your radar.
You are a person of great influence. If you could start a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. :-)
I firmly believe that basic nutrition knowledge paired with a higher degree of efficacy related to cooking at home could be a catalyst for improved performance and confidence. I want our society to re-embrace a reformed version of Home Economics in schools. This class can skip baking cakes and making pasta. It would be focused on how to meal plan and prepare high protein, low sugar meals safely and efficiently. It would answer questions like: How do I cook meat, seafood, and vegetables so they taste good? How do I store pre-cooked food and how long is it good for? How much of each item should I eat in a serving and why?
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